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The Slowdown in Venture Capital Deals is a Cause for Concern

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The Slowdown in Venture Capital Deals is a Cause for Concern

Last year, the market for venture capital soared to new heights. A record amount of money was raised, with global funding for VC-backed companies reaching $128.5 billion, a 44% jump from 2014.

However, this impressive annual data doesn’t show the whole picture. The fact of the matter is that the flow of venture capital deals peaked mid-year, and then began to disintegrate in the autumn.

Here’s another look, this time with quarterly data from CB Insights:

VC Deals by Quarter

The data for Q4 is a steep drop off in terms of deal-flow, and this number hasn’t been this low since Q1 of 2013. The better news is that a total of $27.2 billion was raised, which is more or less on par with previous quarters.

What’s Happening?

Venture capital stalwarts have noted that this lack of deals could be a blip on the radar.

“I’m not aware of any VC who pays attention to any quarter to quarter data at all,” Marc Andreessen, a prominent name in venture capital, noted in a Forbes piece.

That said, a sudden slowdown of this magnitude does raise questions. This is especially true given some of the market developments of 2015.

Firstly, this slowdown in venture capital deals has corresponded with the general anxiety and volatility occurring in public markets. Further, it’s also occurring on the heels of several less-than-stellar IPO performances and repeated calls of a tech valuation bubble. Lastly, while 2015 set records in terms of dollars spent in terms of funding, the amount of new capital raised by venture capital funds dipped significantly from 2014 levels.

This evidence would suggest that venture capital firms, as well as those that fund them, are becoming more discriminatory in how they spend their money.

Venture Capital in 2015: At a Glance

Where did venture capital money go to in 2015?

Here are some further charts from Raconteur that show the distribution behind the 100 biggest venture capital deals:

Top 100 Deals by Region

VC Deals by Geography

10 Largest Raises in Digital

Biggest deals of 2015

Digital Deals by Sector
Click image to expand

Biggest deals of 2015

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Visualizing Internet Usage by Global Region

In this infographic, we map out internet usage by global region based on the latest data from the World Bank.

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Map showing internet usage by region.

Visualizing Internet Usage by Global Region

This was originally posted on our Voronoi app. Download the app for free on iOS or Android and discover incredible data-driven charts from a variety of trusted sources.

Digital technologies have become an integral part of our daily lives, transforming communications, business, health, education, and more. Yet, billions of people around the world are still offline, and digital advancement has been uneven.

Here, we map internet usage by region based on data from the World Bank’s Digital Progress and Trends Report 2023.

Digitalization Has Been Uneven

According to the World Bank, between 2018 and 2022, the world gained 1.5 billion new internet users.

In 2020 alone, the share of the global population using the internet increased by 6% (500 million people), marking the highest jump in history. India, in particular, has seen high rates of adoption. For example, in 2018, only 20% of Indians used the internet. By 2022, this percentage had grown to more than 50%.

RegionIndividuals using the internet (% of population)
East Asia & Pacific74
Europe & Central Asia87
Latin America & the Caribbean76
Middle East & North Africa77
North America92
South Asia42
Sub-Saharan Africa34

However, the progress of digitalization has been uneven both within and across countries.

In 2022, one-third of the global population remained offline, with parts of Asia and Africa still experiencing very low rates of internet usage. For instance, more than half of businesses in Burkina Faso, Ethiopia, Ghana, and Senegal reportedly lack internet connection.

According to the World Bank’s report, when fast internet becomes available, the probability of an individual being employed increases by up to 13%, and total employment per firm increases by up to 22%. Moreover, firm exports nearly quadruple with the availability of fast internet. Across Africa, 3G coverage has been associated with a reduction in extreme poverty, with reductions of 10% seen in Senegal and 4.3% in Nigeria.

Curious to learn more about the internet? Check out this animated chart that shows the most popular web browsers since 1994.

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